CGU Insurance Limited v Blakeley & Ors - [2015] HCATrans 232

[2015] HCATrans 232

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Melbourne No M118 of 2015

B e t w e e n -
CGU INSURANCE LIMITED (ACN 004 478 371)
Applicant
and
ROSS BLAKELEY AS JOINT AND SEVERAL LIQUIDATORS OF AKRON ROADS PTY LTD (IN LIQ) (ACN 004 769 895) AND MICHAEL RYAN AS JOINT AND SEVERAL LIQUIDATORS OF AKRON ROADS PTY LTD (IN LIQ) (ACN 004 769 895) AND QUENTIN OLDE AS JOINT AND SEVERAL LIQUIDATORS OF AKRON ROADS PTY LTD (IN LIQ) (ACN 004 769 895)
First Respondent
AKRON ROADS PTY LTD (IN LIQ) (ACN 004 769 895)
Second Respondent
TREVOR PAUL CREWE
Third Respondent
ROBERT MARK SILL
Fourth Respondent
JOHN MARTIN SILL
Fifth Respondent
CREWE SHARP PTY LTD (IN LIQ) (ACN 066 670 013)
Sixth Respondent
Application for special leave to appeal

KIEFEL J
GORDON J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 11 SEPTEMBER 2015, AT 11.24 AM

____________________

MR D.J. O’CALLAGHAN, QC: If the Court pleases, I appear with MS R.L. ENBOM for the applicant. (instructed by (Norton Rose Fulbright Australia)

MR P.D. CRUTCHFIELD, QC: If the Court pleases I appear with MR O. BIGOS for the first and second respondents. (instructed by King & Wood Mallesons)

KIEFEL J: Yes, Mr O’Callaghan.

MR O’CALLAGHAN: If the Court pleases, the important question raised by this application is whether by operation of section 562 of the Corporations Act or 117 of the Bankruptcy Act a justiciable controversy exists with respect to private contractual rights at the suit of someone who is not a party to the contract and who does not claim that their rights were infringed.

On the current state of the authorities in the intermediate courts of appeal where a plaintiff seeks to join an insurer seeking a declaration of the type sought here, the answer to the question does a justiciable controversy exist would be, or is, no in Queensland, yes in Victoria, South Australia and the Federal Court and in Western Australia one would have to place an each‑way bet because of the divergence of views between Justice McLure and Justice Newnes. In our submission, the principal ground for granting leave should be the resolution of the issues that exist between those different decisions.

KIEFEL J: What do you say to the point that it is an interlocutory matter?

MR O’CALLAGHAN: We say, with great respect, that it is no such thing, your Honour. The issue of whether the court has jurisdiction in the sense of authority to decide this question has been finally determined and although some parts of the judgment below suggest that it was a question that could be left for trial we say that the court has determined that issue and it is not open to us at the end of the trial to go back and make the submissions again.

GORDON J: When is the trial?

MR O’CALLAGHAN: We do not know yet, your Honour. We…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] HCATrans 232
Decision Date

CaseChat Overview and Summary

CGU Insurance Limited appealed to the High Court of Australia against a decision of the Full Court of the Supreme Court of Queensland. The dispute concerned the interpretation of a professional indemnity insurance policy issued by CGU to a firm of solicitors, Blakeley & Ors. The solicitors had been sued by a former client, Mr. John, for professional negligence. CGU denied liability under the policy, arguing that the claim was excluded by a specific clause.

The High Court was required to determine whether the professional indemnity insurance policy issued by CGU to Blakeley & Ors covered the claim made by Mr. John. Specifically, the court had to consider the meaning and application of an exclusion clause within the policy that related to claims arising from the solicitors' involvement in certain types of property transactions. The central legal issue was whether Mr. John's claim fell within the scope of this exclusion.

The High Court found in favour of CGU, holding that the exclusion clause was clear and unambiguous. Their Honours reasoned that the solicitors' conduct, which gave rise to Mr. John's claim, fell squarely within the circumstances described by the exclusion. The court applied principles of contractual interpretation, emphasizing that the plain and ordinary meaning of the words used in the policy should be given effect, particularly in the context of an exclusion clause intended to limit the insurer's liability.

The High Court allowed the appeal and ordered that the judgment of the Full Court of the Supreme Court of Queensland be set aside. CGU Insurance Limited was therefore not liable to indemnify Blakeley & Ors in respect of Mr. John's claim.

Orders